What is the main purpose of establishing a business?
The primary objective of establishing a business is to maximize profit through efficient production and sales, though secondary goals like employment may arise; regulation and price control are governmental functions.
Which of the following is a characteristic of a private limited company?
Private limited companies restrict share transfers to maintain control among members, unlike public companies that freely issue shares to the public; liability is limited, and ownership can be multiple.
The document that outlines the objectives of a company is called?
The Memorandum of Association defines the company's scope, objectives, and powers, serving as its constitution; Articles govern internal management, Prospectus invites public subscriptions.
Which of the following is a source of short-term finance?
Bank overdraft allows temporary excess withdrawal up to a limit, repaid quickly, ideal for short-term needs; debentures/shares are long-term, retained earnings internal.
The process of dividing a market into distinct groups of buyers is known as?
Market segmentation identifies buyer groups by demographics, needs, etc., for targeted strategies; research gathers data, differentiation distinguishes products, advertising promotes.
Which of the following is a function of a commercial bank?
Commercial banks accept deposits from customers, offering safety and interest; currency issuance/printing is central bank, policy regulation central bank.
A document used to request payment for goods supplied is called?
An invoice details goods supplied, quantities, prices, and payment terms, requesting settlement; quotation estimates cost, receipt acknowledges payment, waybill tracks shipment.
Which of the following is a feature of a perfect market?
Perfect (ideal) markets have numerous buyers/sellers, none influencing price (price takers); no differentiation, free entry/exit.
The term “FOB” in international trade means?
FOB specifies seller delivers goods on board ship at port of shipment, buyer assumes risk/cost thereafter; standard Incoterm.
Which of the following is a function of a retailer?
Retailers break bulk, selling small units to consumers; wholesalers buy in bulk/warehouse, producers finance themselves.
A business owned and controlled by the government is called?
Public corporations (statutory) are government-established/owned for public service (e.g., NNPC), unlike private partnerships/cooperatives.
Which of the following is a disadvantage of advertising?
Advertising incurs high costs (media, production), potentially raising prices; benefits include sales/awareness, but not quality improvement.
The body responsible for regulating the stock exchange in Nigeria is?
Securities and Exchange Commission (SEC) oversees capital market, ensuring fair trading; CBN monetary, NAFDAC drugs, NDLEA narcotics.
Which of the following is a feature of a credit card?
Credit cards provide revolving credit up to a limit, repayable with interest if not cleared; unlike debit (direct deduction), interest charged, requires account.
The process of transporting goods from one place to another is called?
Distribution involves moving goods from producers to consumers via transport channels; warehousing storage, marketing promotion, production making.
Which of the following is a type of marine insurance?
Hull insurance covers ship/vessel damage; marine insures sea risks, unlike fire (property), life/health (personal).
A written agreement between partners is known as?
Partnership deed outlines terms, capital, profit sharing, duties; company docs for incorporated entities.
Which of the following is a characteristic of a cooperative society?
Cooperatives emphasize one-member-one-vote regardless of shares, democratic control; limited liability yes, but equal voting key, not profit max/public shares.
The term used to describe goods bought for resale is?
Commercial goods (merchandise) purchased by traders for resale with profit; capital for production, consumer end-use, industrial manufacturing.
Which of the following is a function of a bill of lading?
Bill of lading serves as receipt, evidence of carriage contract, and document of title for goods in transit.
The main objective of a chamber of commerce is to?
Chambers represent businesses, lobbying for favorable policies, networking, promoting trade; not regulatory/lending.
Which of the following is a feature of a departmental store?
Departmental stores offer diverse goods (clothing, electronics) under one roof, departments; not single product/multiple locations like chains.
A document that confirms payment for goods purchased is called?
Receipt acknowledges payment received; invoice requests payment, quotation estimates, delivery note confirms dispatch.
Which of the following is a function of the money market?
Money market deals in short-term instruments (e.g., treasury bills <1 year) for liquidity; capital market long-term.
The term “branding” refers to?
Branding creates unique name/logo/image to differentiate, build loyalty; packaging protects, pricing sets value, distribution channels.
Which of the following is a type of business risk?
Political risk (e.g., policy changes, instability) affects operations/profits; all are risks, but political specific to government actions.
A market where securities are bought and sold is called?
Capital market trades long-term securities (stocks, bonds) for investment; money short-term, commodity physical goods.
Which of the following is a function of a clearing house?
Clearing houses facilitate interbank settlement, reducing counterparty risk in payments/securities; not issuance/lending/regulation.
The term “carriage paid” means?
Carriage paid (CP) indicates seller covers transport to destination; buyer pays delivery.
Which of the following is a feature of a hypermarket?
Hypermarkets offer wide variety (groceries, apparel) in large spaces, combining self-service supermarket with departmental store.
A document that authorizes the release of goods from a warehouse is?
Warehouse warrant (receipt) proves ownership, authorizes release upon presentation; bill of lading for shipping.
Which of the following is a disadvantage of a partnership?
Partners have unlimited liability, personal assets at risk for debts; quick decisions/shared capital advantages.
The term used to describe goods sold at a reduced price is?
Discount is price reduction to stimulate sales; markup added cost, margin difference, profit revenue minus cost.
Which of the following is a function of the Nigerian Export Promotion Council?
NEPC assists exporters with incentives, market info, to boost non-oil exports; imports regulated by customs.
A business that sells services rather than physical goods is part of the?
Tertiary sector provides services (banking, transport); primary extraction, secondary manufacturing.
Which of the following is a type of trade promotion?
Trade promotions target intermediaries (e.g., discounts, allowances); advertising/PR/selling consumer-focused.
The term “capital employed” refers to?
Capital employed = total assets - current liabilities (or fixed + working capital), used in ROI calculations.
Which of the following is a feature of a public corporation?
Public corporations are fully government-owned/controlled for public welfare, not private profit/shares.
A document used to inform a buyer of goods dispatched is called?
Advice note details dispatched goods (quantities, description) pre-invoice; confirms shipment.
Which of the following is a function of the marketing mix?
Marketing mix (4Ps) includes pricing strategy to balance costs, demand, competition for profitability.
Now practice in exam mode
You've studied the answers — now test yourself under real exam conditions with the timer running.
Start WAEC Commerce 2024 Quiz